Is Blockchain for real?
Is Blockchain Bitcoin or is Bitcoin Blockchain? Do all these ICOs need a Blockchain?
The questions are numerous, many answers are often ludicrous. There is a lot of truth to the fact that Blockchain is a general term that has been used as marketing hype by many of the now-defunct coins, 800 and counting. Check out that list here https://deadcoins.com There is also a lot of truth to the fact that Blockchain technology has a bright future and could very well reshape the way we all live. Personally, I think it will, in fact, it already is. Bitcoin anyone?
What is Blockchain?
What are we talking about when we use the term Blockchain? You have to understand a fundamental point, there are open and closed Blockchains. An open Blockchain, Bitcoins and to varying degrees, the other main players like the Ethereum Blockchain are decentralised, are trust-less, neutral systems that do not rely on anyone. The network is effectively what you trust not a third party. Information is spread out thinly, so it doesn’t have a central point that can be attacked. That is sexy, that is disruptive and that is now. The key thing to understand is that an open Blockchain is border-less, no individual, no company or country controls it. Before moving on you should also know that Blockchain technology is one of four components that make up what Bitcoin is. The other three are Cryptography, the Peer to Peer network and Proof of work. Hopefully, that helps answer the question, is Bitcoin Blockchain?
Some people will argue that the Blockchains of Ethereum, EOS etc are nowhere near as decentralised and open as Bitcoin but that debate is for another article. I want to highlight the blatant use of the term Blockchain by so many scam projects. ICOs have really gone to ridiculous lengths with the use of the term to raise funds. A little bit of knowledge will help you understand if the ICOs you are thinking about investing in, really is a Blockchain, or if it needs one. More often than not traditional database technology would do what they are marketing to you a lot better.
Using Blockchain as Deception
We have also witnessed companies using the term Blockchain in name changes and this it could be argued resulted in massive spikes in their valuations. Examples of this are New York Long Island Ice Tea Corp, changing to Long Blockchain Corp., and seeing an instant 200% gain in the value of its shares. On May 25th of this year, the Nasdaq decided to delist the company. I guess they know what a Blockchain is. Another recent example is On-line PLC who changed their name to On-line Blockchain PLC and enjoyed a 394% gain in value in a 24-hour period. It looks like time is up for these misleading practices as the SEC, the Securities and Exchange Commission is taking a firm stance against such practices. They recently have gone after UBI Blockchain internet LTD. It will be interesting to see how that plays out given that the company is engaged in the sale of maternity clothing, children’s toys and cosmetics and doesn’t appear to be using a Blockchain.
It’s my mission to try and keep up with the huge amount of information out there, weed out the nonsense and champion the good projects for you. Let’s be super clear, upfront. I strongly believe in Bitcoin and I believe strongly that most of the other coins and their Bollocks chains are very, very questionable. Don’t get me wrong ‘super shit coin’ that now has a war chest of Millions and in some case’s Billions to play with has a good chance of succeeding. Who could not make something succeed with that amount of money to work with? It’s a laughable situation but at least the cleanout is underway and we will be left with the next Amazon, the next Facebook. For the smart investor, huge returns are still very much available. For the cashed-up CEO of a dodgy ICO, sleepless nights and in some cases possible jail time awaits. FUD, fear, uncertainty and doubt are entering his mind now. FUD is a term usually used in reference to market sentiment, but I think it’s a great way to describe what will be causing the scammers sleepless nights. The party is over! People expect results and authorities are starting to ask tough questions of him and his marketing team, I am assuming they didn’t hire anyone else! Coders, nah, personal shoppers and a masseuse are more likely.
Bitcoin is Here to Stay
This is a great video from Andreas Antonopoulos at a Blockchain conference last year. Andreas is a key thought leader in this space and I recommend watching this clip. A key statement that he made here is that:
‘Where Bitcoin and the other open Blockchains are today is exactly where the internet was in 1992 in terms of technology, in terms of infrastructure deployment in terms of adoption patterns. But the hype around Blockchain is exactly where the internet was in 1998 and we all know what happened next’.
Sobering comments and accurate ones as demonstrated by the list of failed ‘Blockchain’ projects.
The next time you hear someone say Bitcoin is rubbish but Blockchain is the future ask them to explain in a bit more detail than that throw-away statement. Yes, the technology is being researched and developed by banks, insurance companies and so forth, but it’s got a long way to go. You should also understand that this Blockchain technology is not necessarily open-source. These closed or private Blockchains will change many industries but this will take time and require some catch up in skill sets to meet the booming demand in this space. It’s early days people so take each project on its merits and don’t think it is the solution to everything, at least not yet.
So, what does this all add up to? It’s simple people, take a backwards step and understand what Bitcoin actually is, trust me it won’t take long, and you will like what you find. This article covers what you need to know. You will then have a good foundation to understand what Blockchain is. It’s an emerging technology and is a general term for many things which we will address individually moving forward with this series of articles. Public vs Private Blockchain being the first.
If there is one thing I want you to take from this article, it’s that Bitcoin is different. It’s the main Blockchain, it’s been with us going on for 10 years now and has proved its resilience. The fact that it doesn’t do a million things is a big part of why it’s resilient and secure. A reminder that the Blockchain tech that makes up part of what Bitcoin is, is just that, a part. Satoshi did not make a huge song and dance with regards to that particular piece of Bitcoins tech. Yes, it is something with huge promise for other projects but keep it in perspective. It suits what Bitcoin is very well, but ask the hard questions of others touting their Blockchain solutions. We are just beginning and the marketing should acknowledge that.